The Intermediary Lenders Association has strongly refuted an FSA conclusion that specialist lenders are taking a one size fits all approach to mortgage arrears. The FSA report into arrears, published this week, investigated 13 mainstream and specialist lenders. The regulator says it found mainstream lenders largely complying with FSA requirements but it has particular concerns with specialist lenders.
These include operating a "one size fits all model" too strongly focused on arrears recovery, being too ready to take court action and lower standards of systems and controls. Many banks have indicated increasing arrears in their latest results. This week Northern Rock arrears over three months reached 1.18 per cent which have more than doubled since the start of the year when it was 0.45 per cent. The CML average as at March 31 2008 was 1.21 per cent for
The report found some issue with all lenders, suggesting they could do more to consider customers' individual circumstances, that unfair charges are levied in some circumstances and that lenders are not exercising sufficient oversight of third parties contacted to carry out mortgage arrears and repossessions.